Ah Dear Danger Mouse,

I see the trap hasn’t caught you yet! Long may that be the case!

Some thoughts for you:

Buyer Advocates

Go in with your eyes open. The usual ways BAs role is that they lock up the deal, then try to shop it around. I would want to know if they have an immediate buyer. Beware the re-trade too at the end of DD (where they significantly drop their offer after eating up the DD time). Six months is a long time mate.

Subdivision

I’m inclined to explore this option with a town planner by setting aside a limited amount as a feasibility budget. That will also shed more light on whether the BA route is likely or not. You’re playing with profit here, so the more you know, the better informed you’ll be.

Building

Unless you are an experienced developer / builder, the $300k profit is not worth the extra risk, and aggravation, in my opinion. That said, I think the SW Brissie optics are strong until the Olympics.

Long live the mouse!

• This reply was modified 1 month ago by  Steve McKnight.

Is it physically possible? It sounds so!

Is it legal? That will depend on compliance with planning and building permitting.

Is it financial? That will depend on the cost vs. return.

Is it smart? That’s your call as beauty is in the eye of the beholder. It sounds like a hard way to make money to me re: a lot of aggravation. Also, it sounds like an active asset which isn’t normally something suitable for SMSFs (i.e. SMSFs are not allowed to run businesses).

All the best,

– Steve

Hi,

First, I would disconnect the cameras so your privacy is not at risk.

Next, was the camera includes in the sale contract as a fixture? If so, I would go back to the lawyer / firm who did the conveyancing and seek their assistance. If not then I’m not sure where you stand.

All the best,

– Steve

Hi,

Any vendor finance sale will need legal advice and careful structuring to consider stamp duty (will vary by state) and income tax implications.

I haven’t seen a loan in Aus that is assumable, but they may be out there. Typically larger commercial property deals are financed by commercial paper (such as rolling commercial bills), rather than a loan like a home loan. These are unlikely to be assumable.

Buying the company will still likely trigger income tax and stamp duty implications, but again, legal advice is warranted.

If you don’t proceed, you are welcome to flick the details of the deals to me to see if it is of interest in the new fund I have established.

Bye,

– Steve

Howdy Stargazer. Member since 2002 eh? Thanks for sticking with me :-)

The problem here is that you are letting the asset lead the outcome. That is, you don’t know what to do because you don’t seem to have a clear picture in your head about what you want your assets to achieve.

Here’s what I wrote in prep for a Money Magnet podcast yesterday:

• If you don’t have a then, you won’t have a why
• If you don’t have a why, when becomes based on urgency and you become reactive rather than proactive.
• Without a why and when, what or how is unclear, and so you will gravitate back to your parental and societal programming
• When it comes to investing, that is likely to be good assets, in good locations, in the hope of a good profit.

• Set a ‘Then’
• Identify ‘Why’
• Clarify ‘When’
• Let the Then, When and Why determine the What and How

In summary, the right thing for you to do depends on what you want to achieve.

Final comment – make sure you come to my upcoming 1-day seminar. I will explain more about this at the event in the context of ‘making your money count’.

Bye,

– Steve

Thanks for the post.

I’m sad to learn your professional network is telling you something can’t be done when mine time and time again says it can be (and I continue to use and apply it).

I’m not sure how you reconcile that, and I’m over repeating myself over and over and over again on this issue.

If you can’t,  you can’t. If you can, you can. Find a way or make a way.

Bye,

Steve

G’day there. This is a question of whether the improved value exceeds the cost of acquisiton and improvement (rezoning) by enough of a margin to justify the risk and aggravation. You’ll need to do your numbers to find out.

One thing I would be trying to figure out is whether there is demand for such land, and if so, at what price. Pre-sales would be important to de-risk the deal, so chatting to an agent would help. Start with end sale proceeds, deduct costs, and see how much profit is left over.

Bye,

– Steve

Hello Jon.

Thanks for your post and sorry to read about your situation.

I am confused about the insurance policy. Whose name is it in – yours or the bordy corporate (BC)?

I would expect the BC would ensure for public liability and for structural matters for common areas, but that each owner is responsible for their portion of the building (strata title), and public liability of the same.

As for what is and isn’t covered, you should read the relevant policy carefully and even seek legal advice in order to get an expert opinion. Given the dollars involved, (up to) a few thousand in legals seems to be well worth it.

Sometimes insurers will disclaim out of the gate and need some further ‘encouragement’ to reassess and pay out. Hence a good lawyer is where I would turn to for help.

Sincerely,

– Steve

Hi Charlie,

Perhaps your lawyer has a view I haven’t heard before, but my understanding of trusts, companies and corporate law is that trusts separate ownership and control. Can your accountant contact your lawyer to confirm their opinion and perhaps provide you with a summary?

All the best,

– Steve

• This reply was modified 2 years ago by  Steve McKnight.

Hi there,

I wish I had better news, but the stamp duty laws are pretty tight, and I understand options to purchase are caught in many instances.

I suggest engaging the services of a good property development lawyer to guide you through what might be able to be done, just in case your current legal team haven’t thought of something.

It might just be what it is I am afraid, and if the SD kills the deal, then it won’t be the first time that tax has ruined a good idea.

Bye,

– Steve